Trump’s Harvard Crackdown and Global Education Investment Trends

“The pressures on enrollment caused by visa restrictions flow downhill. This means that elite colleges and large state schools simply take more students off their waiting lists, but the real pressure becomes demand among less prestigious and tuition-dependent institutions.”

Trace Urdan, Managing Director, Tyton Partners Investment Banking

The Trump administration’s 2025 executive order restricting Harvard’s international student visas has jolted the foundations of American higher education. The measure threatens an estimated $7 billion in annual revenue and roughly 60,000 jobs across the sector, exposing how dependent many universities have become on full-pay international enrollments. Already facing demographic headwinds and rising costs, U.S. colleges and universities now confront a fresh layer of policy risk that could reshape their global competitiveness.

This disruption is not unfolding in isolation. Countries such as Canada, Australia, and Germany are moving quickly to capture students who might have headed to the United States, offering more predictable visa pathways and friendlier immigration policies. Their agility highlights how student mobility and educational investment are becoming increasingly borderless. To better understand how these shifts are influencing investor strategies and the outlook for education services, we spoke with Trace Urdan, managing director at Tyton Partners, who shared detailed insights on how policy volatility, capital flows, and technology-driven change are reshaping the market.

Trace Urdan is a managing director at Tyton Partners and has followed the global knowledge market for nearly 20 years.

He has spent much of his career as an equity research analyst covering the knowledge services sector, most recently as a managing director at Credit Suisse. Prior to working in the institutional investment industry, Urdan was the CFO of the information, communications, and entertainment practice at KPMG Peat Marwick. Prior to that, he held several senior management positions at TIME Inc. Asia in Hong Kong.

Urdan is primarily focused on developing new relationships in support of the firm’s banking and consulting practices and extending its sector thought leadership through various research, publishing, and presenting initiatives. He is based in San Francisco, CA.

During his career, he has followed a wide range of companies serving the education market, including early childhood, K-12, higher education, and employment training. He is widely cited as an expert on the topics of for-profit education, education technology, and education policy. He has been cited by Career College Central magazine as one of the 25 most influential people in the career college sector, testified before the Spellings Commission on the Future of Higher Education, and authored a white paper for the Kauffman Foundation on the topic of higher education regulation.

He received a BA degree from Yale University and an MBA from Harvard Business School.

Despite headlines about visa restrictions and declining international enrollments, investors are not abandoning the U.S. higher education market. Urdan explains that the structural drivers for education services remain strong even as certain institutions face revenue pressures. “U.S. policy toward higher education (HE) will pressure revenue in the sector broadly, but to date it has not translated into meaningful disruptions in the investment climate,” he says.

From an investment perspective, higher education services remain a key focus. “HE Services companies are seen as more important than ever, whether to reduce costs or find additional sources of revenue, while the administration’s attitude toward for-profit colleges is seen as constructive, making those assets more investible,” Urdan adds. These companies, which include enrollment management firms, technology partners, and online program managers, continue to draw steady interest because they help institutions adapt to enrollment challenges and find new revenue streams.

Urdan’s view highlights an important distinction between sector headlines and underlying financial behavior. While the new visa restrictions have stirred debate about international competitiveness, investors tend to look past short-term uncertainty and concentrate on long-term market needs. Services that lower institutional costs, open new revenue channels, and integrate technology are still essential, and policy changes have not diminished their relevance.

This perspective also helps explain why U.S. education remains a core asset class in global portfolios. Even as international students weigh alternative destinations, the domestic demand for credentials, workforce training, and cost management persists. For investors, the challenge is less about exiting the U.S. market and more about positioning capital where these enduring needs intersect with scalable service models. In this environment, policy shocks act as a test of resilience rather than a reason to withdraw, reinforcing why education services continue to attract attention as a stable, long-term investment.

While most higher education investments remain steady, the visa restrictions have created real pressures for companies that recruit and support foreign students. Urdan notes, “Companies focused on recruiting and supporting foreign students are the one exception to the statement above. While most are global in scope and lived through the prior Trump administration and therefore are positioned to adjust their business to support enrollment in other countries, Visa restrictions have created challenges for these providers.” This niche faces immediate operational hurdles as it shifts its recruitment networks and builds partnerships in alternative destinations.

The strain is felt unevenly across the sector: “The pressures on enrollment caused by visa restrictions flow downhill. This means that elite colleges and large state schools simply take more students off their waiting lists, but the real pressure becomes demand among less prestigious and tuition-dependent institutions. This will drive consolidation among these weaker schools,” Urdan explains. Stronger institutions can buffer the shock by tapping into deep applicant pools, while smaller colleges, reliant on international tuition, find themselves exposed.

These dynamics indicate a forthcoming wave of mergers, acquisitions, and closures among vulnerable schools. Investors are watching for opportunities to acquire undervalued assets, finance restructurings, or provide turnaround services as market realignment accelerates. For service providers, the near-term revenue effect may be limited, but over time, consolidation will reshape client bases and service contracts.

Capital is also expected to shift in subtle ways. Funds targeting infrastructure, back-end management, and recruitment technology will continue to find opportunities, but with a sharper focus on geographic diversification. Providers able to operate seamlessly across borders, redirecting student flows toward Canada, Europe, or Asia, are best positioned to attract new investment. In this sense, the current policy shock is both a challenge and an early indicator of where future capital will cluster.

The turbulence in traditional higher education might suggest a surge in demand for short, skills-focused programs, yet investors are cautious. Urdan explains:

“While the disruption in higher education and pressures on federal financing would suggest that more students should be focused on alternative credentials, this space is still in the midst of major disruption from AI. That said, there are still pockets of relative strength, such as cybersecurity training. But this is not a sector that is attracting much new investment at the moment, and certainly nothing like the boom we saw during Covid.”

The appetite for micro-credentials and short-form training remains uneven as artificial intelligence reshapes how content is delivered and valued.

AI’s influence runs deeper than student demand. It is changing the core operations of education services: “Within higher education services has long been the most investible category and should remain so. Despite the boom and bust of the OPM market, there is a general sense that corporate partners, particularly in areas related to technology, are here to stay. The distinction between ‘learning platforms’ and ‘infrastructure’ has less and less meaning,” Urdan observes.

This blurring of lines reflects a market where technology platforms, compliance systems, and academic delivery increasingly overlap, making service ecosystems more important than any single product.

Policy changes themselves are creating openings for new products and tools. Urdan points out, “Some of the policy changes will create new applications for start-ups and larger entrenched players to grow into: default aversion services following the resumption of loan collections, institutional lending services, career placement and tracking are all areas that will see growth as a direct result of policy.” These segments, often overlooked in headline discussions of tuition and visas, represent critical infrastructure for universities navigating financial and workforce challenges.

For investors, the takeaway is that growth lies less in standalone online courses than in integrated solutions that help institutions manage risk, finance education, and place graduates. AI disruption is simultaneously dismantling old models and accelerating the demand for sophisticated back-end technology. The winners will be companies that can merge compliance, analytics, and student support into scalable platforms, giving both universities and learners the stability and flexibility they need in a more volatile policy environment.

The immediate fallout from the Trump administration’s visa crackdown underscores how quickly policy can reshape global education flows. Students seeking stable study and immigration pathways are increasingly looking beyond the United States. Countries such as Canada, Australia, and Germany are responding with streamlined visa processes and targeted recruitment strategies, positioning themselves as reliable destinations for internationally mobile talent. These shifts create fresh opportunities for investors and institutions willing to operate across borders.

For U.S. universities, the policy shock is a call to rethink their long-term strategies. Dependence on international tuition revenue has been a strength and a vulnerability, funding academic expansion while exposing budgets to geopolitical risk. Institutions that diversify their recruitment pipelines, build joint programs with foreign universities, and expand digital offerings will be better prepared for continued uncertainty.

Investors are likely to reward models that blend education, immigration, and workforce solutions. Cross-border degree pathways, international branch campuses, and hybrid programs that enable students to study in multiple countries or partially online can meet the rising global demand for flexible, career-aligned credentials. These approaches also complement the technology-driven infrastructure segments that Urdan identifies as promising, such as institutional lending and career placement platforms.

As policy-driven disruptions become more frequent, education is evolving into a borderless market where resilience and adaptability are valued above all else. The Trump administration’s order may have triggered the latest shock, but the structural story is larger. Capital will flow to providers that can navigate political volatility while delivering scalable services to students worldwide. In this new landscape, the institutions and investors that move early to diversify and integrate global operations stand to define the next chapter of higher education’s growth.